U.S. AUTO PARTS NETWORK, INC. (NASDAQ:PRTS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.
Amendment to Credit Agreement and Security Agreement
On November 15, 2016, U.S. Auto Parts Network, Inc. (the
Company), certain of its domestic subsidiaries and JPMorgan Chase
Bank, N.A. (JPMorgan) entered into a Tenth Amendment to Credit
Agreement and Fourth Amendment to Pledge and Security Agreement
(the Amendment), which amended the Credit Agreement previously
entered into by the Company, certain of its domestic subsidiaries
and JPMorgan on April 26, 2012 (as amended, the Credit Agreement)
and the Pledge and Security Agreement previously entered into by
the Company, certain of its domestic subsidiaries and JPMorgan on
April 26, 2012 (as amended, the Security Agreement).
Company), certain of its domestic subsidiaries and JPMorgan Chase
Bank, N.A. (JPMorgan) entered into a Tenth Amendment to Credit
Agreement and Fourth Amendment to Pledge and Security Agreement
(the Amendment), which amended the Credit Agreement previously
entered into by the Company, certain of its domestic subsidiaries
and JPMorgan on April 26, 2012 (as amended, the Credit Agreement)
and the Pledge and Security Agreement previously entered into by
the Company, certain of its domestic subsidiaries and JPMorgan on
April 26, 2012 (as amended, the Security Agreement).
to the Amendment, the maturity date of the Credit Agreement was
extended from April 26, 2017 through April 26, 2020. The
following amendments to the Credit Agreement and Security
Agreement were also made:
extended from April 26, 2017 through April 26, 2020. The
following amendments to the Credit Agreement and Security
Agreement were also made:
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The aggregate principal amount of indebtedness that is
permitted related to capital leases was increased from $2,000,000 to $3,500,000. |
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The Companys letters of credit exposure was increased from
$15,000,000 to $20,000,000. |
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Under the terms of the Security Agreement, cash receipts
are deposited into a lock-box, which are at the Companys discretion unless the cash dominion period is in effect, during which cash receipts will be used to reduce amounts owing under the Credit Agreement. The cash dominion period is triggered in an event of default or if excess availability is less than the $3,600,000 for three consecutive business days, and will continue until, during the preceding 60 consecutive days, no event of default existed and excess availability has been greater than $3,600,000 at all times (with the trigger subject to adjustment based on the Companys revolving commitment). |
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The Companys required excess availability related to the
Covenant Testing Trigger Period (as defined under the Credit Agreement) under the revolving commitment under the Credit Agreement is less than $2,400,000 for the period commencing on any day that excess availability is less than $2,400,000 for three consecutive business days, and continuing until excess availability has been greater than or equal to $2,400,000 at all times for 45 consecutive days (with the trigger subject to adjustment based on the Companys revolving commitment). |
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The trigger, requiring the Company to provide certain
reports under the Credit Agreement, relating to excess availability under the revolving commitment under the Credit Agreement is less than $3,600,000 for the period commencing on any day that excess availability is less than $3,600,000 for three consecutive business days, and continuing until excess availability has been greater than or equal to $3,600,000 at all times for 45 consecutive days (with the trigger subject to adjustment based on the Companys revolving commitment). |
The foregoing description of the terms of the Amendment is
qualified in its entirety by reference to the Amendment, which is
attached hereto as Exhibit 10.1.
qualified in its entirety by reference to the Amendment, which is
attached hereto as Exhibit 10.1.
Item 7.01. Regulation FD Disclosure.
On November 15, 2016, the Company also issued a press release
reporting that the Company entered into the Amendment to the
Credit Agreement and that its Board of Directors approved a share
repurchase program which authorizes the Company to purchase up to
$5,000,000 of its outstanding shares of common stock. Purchases
under the Companys repurchase program may be made from time to
time in the open market, in negotiated transactions off the
market, or in such other manner as determined by the Company,
including through plans complying with Rule 10b5-1 under the
Securities Exchange Act of 1934, as amended. The share repurchase
program will expire on March 4, 2017, unless extended or
shortened by the Board of Directors.
reporting that the Company entered into the Amendment to the
Credit Agreement and that its Board of Directors approved a share
repurchase program which authorizes the Company to purchase up to
$5,000,000 of its outstanding shares of common stock. Purchases
under the Companys repurchase program may be made from time to
time in the open market, in negotiated transactions off the
market, or in such other manner as determined by the Company,
including through plans complying with Rule 10b5-1 under the
Securities Exchange Act of 1934, as amended. The share repurchase
program will expire on March 4, 2017, unless extended or
shortened by the Board of Directors.
A copy of the press release is attached hereto as Exhibit 99.1 to
this Current Report and is incorporated herein by reference.
this Current Report and is incorporated herein by reference.
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Item 9.01
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Financial Statements and Exhibits
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(d) Exhibits
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10.1
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Tenth Amendment to Credit Agreement and Fourth
Amendment to Pledge and Security Agreement, dated November 15, 2016, by and among U.S. Auto Parts Network, Inc., certain of its domestic subsidiaries and JPMorgan Chase Bank, N.A. |
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99.1
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Press release, dated November 15, 2016, issued by U.S.
Auto Parts Network, Inc. |
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About U.S. AUTO PARTS NETWORK, INC. (NASDAQ:PRTS)